Do you own research and analysis and no matter what the headlines are saying on any given day, go with what you believe in don’t just follow what someone else tells you to do. Also, don’t play your hand, but play your opponent’s hand. You have to think, “what is no one else thinking right now?” I look at investing from that aspect, being the person on the other side, not following the masses which is hard because you really have to take a step back and look at the overall picture. And it’s a lot of psychology and a lot of emotion but to me that’s the most crucial and most important part of the game. Finally, don’t be fearful. It’s very hard to pull the trigger and buy something when you see all negative news but really, it’s about being counteractive to what everyone else is doing.
As a part of my series about “Investing During The Pandemic”, I had the pleasure of interviewing Lance Ippolito.
Lance Ippolito is the lead strategist at Future of Wealth. He is a former hedge fund trader with a specialization in stocks, options, and futures trading. Today, Lance spends much of his time as a leading industry educator and mentor of trading across the globe.
Thank you for doing this with us! Before we dig in, our readers would like to learn a bit more about you. Can you tell us the “backstory” about what brought you to the finance industry?
I was college and like most people had no idea what I wanted to do. And I was actually in community college for years and I met this girl who was going to be a doctor. So, I thought I needed to do something where I make a lot of money because she’s going to be a doctor. I would go to the gym in the morning and I would see these guys in suits talking about stocks and one day I realized, I was like, hey these guys and girls on TV seem like they have a lot of money talking about stocks. The next week I went back to college, changed my major to finance and I’ve been hooked ever since.
Can you share with our readers the most interesting or amusing story that occurred to you in your career so far? Can you share the lesson or take away you took out of that story?
The biggest thing that made my career was weight Watchers and Oprah. A few years ago, Oprah joined the board of Weightwatchers and at the time the stock was around like 7 dollars and she joined the board and took a big stake in the company. And I worked out and stuff at the time, but I never thought much about Weightwatchers. In fact, many people didn’t even know it was public stock. So when I saw that Oprah was getting involved I made my whole trading and investing strategy around Oprah Winfrey. The only thing I knew about Oprah was that as a kid, my grandma used to watch her show. So, I thought, hey, she’s putting millions and millions of dollars in the stock, why don’t I invest in it.
Within six months the stock more than doubled. That year alone, the stock went from like seven bucks to 95 dollars. I would go on Twitter and I was part of trading groups and trading rooms at the time, and I gained recognition for being the Weightwatchers trader. I would go to the grocery store and get Weightwatchers and eat it all week. If the stock would go up like 30% on earnings, I became like the Oprah fan boy where everything correlated with the stock was because of her. It was the first time I made more money in a trade than I did and all my years of working prior, so it was really life changing.
When you have an ambassador, especially someone with Orpah’s platform and following who puts their money where their mouth is you need to take notice because the people inside the company know more than anyone what is really going on.
Are you working on any exciting new projects now? How do you think that will help people?
I’m working on developing an option scanner where it filters out the largest trades in the world, in the options market, and then the scanner will broadcast live in real time where people can go and actually see it update. It can really narrow down about a dozen trades or a dozen stocks that they follow a day where they don’t have to sift through 3000 or so stocks. The goal is that it will do all the heavy lifting for people and hopefully encourage more people to get involved in trading and investing and take the scary intimidating aspect away from it.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story about that?
When I first got involved in trading, I used to watch YouTube videos, and this is like when YouTube was a new thing. I met an ex-market-maker who had a live trading room and it was at the time there was maybe only a handful of those in the world. I would watch him trade every day for hours and that kind of mentorship, actually watching a professional every day really helped me pick up on how to trade and how to invest for a living, not just doing it part time and I’m very grateful for that opportunity because it started me on my path to where I am today.
Let’s shift a bit to what is happening today in the broader world. Many people have become anxious from the dramatic jolts of the news cycle. The fears related to the coronavirus pandemic have understandably heightened a sense of uncertainty and loneliness. From your experience, what are a few ideas that we can use to effectively offer support to our families and loved ones who are feeling anxious? Can you explain?
The big thing is separating yourself from headline news and not getting caught up in the day-to-day news cycle. I don’t watch the news anymore, I try to look more at the big picture and use the kiss strategy, keep it simple and not be too caught up. For me, little getaways are very healthy, whether it’s going to the beach for a few days or going hiking out in the outdoors or going fishing, stuff like that to escape from day-to-day stress. It’s very healthy to be active and it’s hard because we are at home a lot now with lockdowns so prioritizing getting outside and taking time away from whatever screen you may be looking at is extremely beneficial.
Ok. Thanks for all that. Let’s now jump to the main core of our interview. As you know the stock market and the economy in general have become extremely volatile and uncertain. Many people “dollar cost average” and put aside a monthly sum into a long term savings plan for retirement, college, or a home purchase. If a loved one or a client came to you and said, “I have been saving and investing 500 dollars every month in an S&P 500 index fund. Over the next few months until the dust settles, should I be doing something else with my money?”, what would you say to them?
I would say if you’re making money doing what you’re doing, don’t change it. My biggest thing is stick to the girl you brought to the prom, and if you’re making money in a S&P 500 index fund, why change? It’s simple, it’s easy to do, and you don’t have to follow every headline on every stock because you’re really getting the whole index so stick to what you know.
Eventually the economy will recover and rebound. Certain sectors, like travel and hospitality might be hurting for a while. But other sectors, like technology and healthcare, might do very well. If someone wanted to prepare today to take advantage of the future recovery, what would you suggest they do?
I mostly stick with what works, there’s a reason why technology has led nearly every year. If you want to get more speculative and say there’s going to be a comeback in travel and leisure then you could put money into it, but I would say don’t go all in on something because there is so much uncertainty out there, especially with COVID and the direction of the economy. What we do know about is technology and it’s going to continue to grow, the markets have shown that, so it’s certainly a safer sector during volatile market times.
Are there sectors that provide exciting and lucrative investment opportunities today, specifically because of the volatility and uncertainty?
I love clean energy. Clean energy from solar to electric vehicle to battery power are paving the way to the future. We’re just seeing the first wave of this new industry. If you look back at back decades ago in the oil industry, everyone thought oil was safe and that oil is the great American sector, but oil is dead right now and it will continue to die down. Clean energy is very exciting and it’s changing the world and it’s going to continue to change the future.
Are there alternative investments that you think more people should look more deeply at?
What’s really good right now is there is more transparency in the markets. I’m looking at private placements a lot. With the new rise in SPACs, people looking to get into companies before they necessarily go public, because the IPO process is really so broken, this is a great opportunity. We’ve seen that with Airbnb, door dash and snowflake this year where they’re trading at crazy evaluations compared to what insiders got in these stocks. I think if you could do your research and find a real disruptor industry it could be a unique and lucrative move.
If a person in their thirties and forties came to you today and said that they have 10,000 dollars that they want to put away today for a long term investment what would you advise them to do with it?
Invest in a company or an industry that you can touch. If you go to the store and buy a Nike shirt and you love Nike clothing and shoes or you love exercising, follow that. If you love target and you go to target every weekend and you see it’s packed with people and you think, wow, the new checkout process is easy, stick with that. You can really put your boots on the ground with these companies and see first-hand what’s going on and make decisions from there.
Ok, thank you! Here is a more general finance question. You are a “finance insider”. If you had to advise your adult child about 5 non intuitive essentials for smart investing what would you say? Can you please give a story or an example for each?
The biggest one is not following the herd. Do you own research and analysis and no matter what the headlines are saying on any given day, go with what you believe in don’t just follow what someone else tells you to do. Also, don’t play your hand, but play your opponent’s hand. You have to think, “what is no one else thinking right now?” I look at investing from that aspect, being the person on the other side, not following the masses which is hard because you really have to take a step back and look at the overall picture. And it’s a lot of psychology and a lot of emotion but to me that’s the most crucial and most important part of the game. Finally, don’t be fearful. It’s very hard to pull the trigger and buy something when you see all negative news but really, it’s about being counteractive to what everyone else is doing.
Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
Trading and investing is a life where we’re always wanting to be right. There’s a lot of risk in investing, and even in life to be successful. One quote I really liked is “go ahead and take the risk. If you win, you will be happy if you lose, you will be wise.” For me, it took a while to understand that because obviously if I win, I’m going to be happy. If I make money, I’m going to be happy. But if I lose, I will be wise and losing is just as vital part of the process as winning. I’ve failed at many things, but every time I’ve lost, I’ve learned something. If you only win, you’re not really gaining any knowledge from that. The times where I felt beat down, where I’ve lost, where I have wanted to give up, those have been the biggest growing lessons.
You are a person of enormous influence. If you could inspire a movement that would bring the most amount of good to the greatest amount of people, what would that be? You never know what your idea can trigger. 🙂
The mind is the greatest thing that people have and especially right now, with all these rough times, I’ve experienced, depression, anxiety, and I know many other people have. We don’t really address that as society, as a disease or as a disorder, we’re kind of just like get over it. So, to me really looking at why this happens in people and instead of going the pharmaceutical route that we have for the past 50 plus years or so, increasing therapy and more natural routes would be beneficial to everyone, especially those facing mental health problems. One of the big positives that we have seen from working from home is that we no longer have to go to an office, we can talk to someone on a zoom or FaceTime and its right at our fingertips so a movement where people say “hey I’m here if you ever want to talk” or “hey I know times are hard but talking about it is a good thing” is a shift that should be made in society. We need to be conscious not just of our physical health, but our mental health and the mental health of ours.
Thank you for the interview. We wish you only continued success!